Bill > A3380

Introduced Session

This bill, entitled the "New Jersey Health Insurance Market Preservation Act," restores the recently repealed shared responsibility tax provided under the Affordable Care Act (ACA), which requires most individuals, other than those who qualify for certain exemptions, to obtain health insurance or pay a penalty. The bill is intended to ensure that health insurance markets in New Jersey remain robust and affordable by ensuring that individuals who can afford to purchase insurance participate in the market. Specifically, the bill requires that every resident taxpayer of the State obtain health insurance coverage that qualifies as minimum essential coverage under the bill. If the taxpayer does not obtain coverage, the bill imposes a State shared responsibility tax equal to a taxpayer's federal penalty under the ACA prior to the repeal of that provision. To determine the State shared responsibility tax, the bill largely adopts the rules adopted pursuant to the ACA, with the following changes: (1) The amount of the tax imposed is determined, if applicable, using the State average premium for bronze-level plans rather than the national average premium for bronze-level plans; (2) "Minimum essential coverage" includes, in addition to the types of coverage included under the ACA, the coverage required pursuant to the New Jersey Individual Health Coverage Program; (3) Instead of the United States Secretary of Health and Human Services, in coordination with the United States Secretary of the Treasury, the Commissioner of Banking and Insurance, in coordination with the State Treasurer, has the authority to recognize additional health benefits coverage as "minimum essential" coverage; (4) For purposes of the exemption for individuals who cannot afford coverage: - the required contribution for an individual eligible for minimum essential coverage under both an eligible employer-sponsored plan and a qualified health plan is the lesser of the amounts that the individual would have to pay for coverage of each type; - the income threshold for coverage to be considered unaffordable shall be determined by the Commissioner of Banking and Insurance, in consultation with the State Treasurer; and - no tax shall be imposed under this section with respect to any applicable individual for any month during a calendar year if the taxpayer's gross income for the taxable year is below the State's minimum taxable income threshold; (5) No tax shall be imposed with respect to any applicable individual for any month during which the individual is a bona fide resident of another State; (6) Determinations as to hardship exemptions shall be made by the Commissioner of Banking and Insurance; (7) A grandfathered plan shall qualify as minimum essential coverage only if it satisfies the requirements that apply to non-grandfathered plans sold in the market in which the grandfathered plan is sold; (8) If a taxpayer is subject to both the tax imposed by this section and the federal penalty, the amount of the taxpayer's State income tax is reduced, but not below zero, by the amount of the taxpayer's federal penalty payment; and (9) Health coverage provided under a plan obtained through an association, trust, or multiple employer arrangement, including an out-of-State trust or association, shall not qualify as minimum essential coverage unless the plan complies with the requirements of applicable New Jersey law. Additionally, the tax imposed by the bill is to be assessed and collected in the same manner as under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. The Commissioner of Banking and Insurance will establish a program for determining whether to grant a certification that an individual is entitled to an exemption from either the individual responsibility requirement or the tax by reason of religious conscience or hardship. The bill also expresses the Legislature's intent as to the collection of data necessary for the successful implementation of the tax imposed by the bill. The bill provides that the reporting requirement is necessary to protect various compelling State interests. Accordingly, the bill provides that, for purposes of administering the tax on individuals who fail to maintain minimum essential coverage, every applicable entity, including employers and insurers, that provide minimum essential coverage to an individual during a calendar year shall, at such time as the State Treasurer may prescribe, make a return with information about individuals and their coverage. The return is to be in the form the State Treasurer prescribes, and contain the name, address and Social Security number or taxpayer identification number of the primary insured and the name and Social Security number or taxpayer identification number of each other individual obtaining coverage under the policy; the dates during which that individual was covered under minimum essential coverage during the calendar year and such other information as the State Treasurer may require. To minimize the reporting burden, the return may also be in the form of a return under the ACA. The bill also provides that not earlier than November 1 nor later than November 30 of each year, the State Treasurer, in consultation with the Commissioner of Banking and Insurance, shall send a notification to each taxpayer who files a gross income tax return indicating if the taxpayer or one of the taxpayer's dependents is not enrolled in minimum essential coverage as required by this bill. That notification shall contain information on the services available to obtain coverage. The bill takes effect on October 1, 2018 and applies to taxable years beginning after December 31, 2018.

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Herbert Conaway (D)*,  Pam Lampitt (D)*,  John McKeon (D)*,  Carol Murphy (D)*,  Troy Singleton (D)*,  Joe Vitale (D)*,  Linda Greenstein (D),  Mila Jasey (D),  Raj Mukherji (D),  Nancy Pinkin (D),  Eliana Pintor Marin (D), 

Approved P.L.2018, c.31. (on 05/30/2018)